TP ICAP today confirmed plans to acquire multi-asset brokerage firm Louis Capital Markets as the world’s largest interdealer broker continues with the ambitious growth plans outlined by its new management earlier this year.
Financial terms of the proposed deal were not disclosed. However, TP Icap said in a statement it expects to close the transaction in the first quarter of 2020, subject to customary “completion deliverables and certain other customary commercial conditions.” The UK interdealer broker also seeks regulatory approval by the Financial Conduct Authority (FCA) in the UK, the Financial Industry Regulatory Authority (FINRA) in the US, and other relevant regulators.
Louis Capital Markets is a privately-owned independent firm that has offices in New York, Hong Kong, and Tel Aviv. It was established in New York 20 years ago by Michael Benhamou and Patrice Cohen but is currently primarily based in Europe and supports a range of instruments including equities, derivatives, fixed income, and commodities.
Louis Capital Markets, which also operates a brand called MidCap Partners, has reportedly held sales talks with various firms in recent months as small brokers were trying to keep pace with various regulatory reforms.
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TP Icap takes more steps in an expansion plan
TP ICAP, which earns its bread from making markets in different asset classes, employs thousands of brokers who negotiate trades in markets such as FX and commodities.
Its latest acquisition comes more than two years since it made its first acquisition of Burton-Taylor International Consulting, followed by agency broker Coex Partners.
Most recently, it signed a multi-year deal with Refinitiv to expand its integrated global data across equities, fixed income, FX, derivatives, and commodities.
TP ICAP was formed two years ago following Tullett Prebon’s acquisition of the voice-broking business from its former rival interdealer broker ICAP. TP ICAP’s data and analytics division is a provider of real-time price information from the global OTC financial and commodity markets, covering data from the wholesale inter-dealer brokered financial markets.
Weak growth in revenues and profits in the second quarter sent TP ICAP’s shares plummeting by almost 15 percent, which came a year after sluggish financials prompted the dismissal of ex-CEO John Phizackerley as it failed to exert a sufficiently tough grip on costs.